Electrician Talk banner
1 - 20 of 64 Posts

·
Registered
Joined
·
163 Posts
Yes, Labor Only. You pay sales tax when you buy the material.

You are charging the consumer a higher price when you add for your markup on your materials.

I went to a very information 4 day small business tax seminar in bridgewater, nj it was great.

Report Quarterly unless the amount is over 30,000 for the previous year.

Quareterly you file form ST-50 even if the amount is $0
 

·
Banned
Joined
·
1,246 Posts
You charge sales tax on repair work and only on labor. This is when doing your invoicing digitally really helps, you set it so that sales tax is only applied to the labor on items that are considered repair, then it will calculate it automatically for you.

You have to file sales tax quarterly, by the 20th of the month after the quarter.

Jan, Feb, Mar- File by Apr 20th
Apr, May, Jun- File by Jul 20th
Jul, Aug, Sep- File by Oct 20th
Oct, Nov, Dec- File by Jan 20th

You have to file even if A) You collected $0 sales tax or B) you can't afford to pay the state the money at the time. If you don't have the money you still file on time or else you will get hit with much worse penalties.

You need to register to accept sales tax, did you do that yet? Once you register, you are now on the state's radar. You need to get a signed ST-8 form for every singe job you do that is exempt from sales tax (which is most of them). That's what sucks.

I know a lot of different small contractors in the various trades who never signed up for collecting sales tax. They consider all of their work to be exempt capital improvement. And since they never singed up, they don't have to deal with the ST-8 forms. I'm talking about 30 year old companies that when I asked the owner about ST-8's they had no clue.
 

·
RIP 1959-2015
Joined
·
39,618 Posts
You charge sales tax on repair work and only on labor. This is when doing your invoicing digitally really helps, you set it so that sales tax is only applied to the labor on items that are considered repair, then it will calculate it automatically for you.

You have to file sales tax quarterly, by the 20th of the month after the quarter.

Jan, Feb, Mar- File by Apr 20th
Apr, May, Jun- File by Jul 20th
Jul, Aug, Sep- File by Oct 20th
Oct, Nov, Dec- File by Jan 20th

You have to file even if A) You collected $0 sales tax or B) you can't afford to pay the state the money at the time. If you don't have the money you still file on time or else you will get hit with much worse penalties.

You need to register to accept sales tax, did you do that yet? Once you register, you are now on the state's radar. You need to get a signed ST-8 form for every singe job you do that is exempt from sales tax (which is most of them). That's what sucks.

I know a lot of different small contractors in the various trades who never signed up for collecting sales tax. They consider all of their work to be exempt capital improvement. And since they never singed up, they don't have to deal with the ST-8 forms. I'm talking about 30 year old companies that when I asked the owner about ST-8's they had no clue.

What a pain in the ass that must be...:no:

Also doesn't that expose your hourly rates?
 

·
Registered
Joined
·
3,345 Posts
NY is on a different schedule than NJ. I just did my quarterly yesterday. The period ended the 28th, I report on line and pay it then too. And it is labor only.
 

·
WWMDSD
Joined
·
214 Posts
If you mark up material by 30% isn't that 30% also taxable? My acct told me to add the markup into my labor, please correct me if I'm wrong.
 

·
Registered
Joined
·
455 Posts
Not saying, just sayin'

I had a neighbor up the street who is in the trade with a license. He was signing permits for a local HVAC company (surprise, surprise) for the a/c hookup to the power. Well they jumped the gun and did the work by themselves. The local inspector calls up and says your job failed. What job? I didn't do that work, I was supposed to.

So the inspector runs rampant on the HVAC company. The HVAC company decides to stir some sh!t back and calls up Trenton and say he collects no sales tax. A NJ treasury guy basically says you were ratted out by x after looking everything over. The taxman asks to call him back collect in a few minutes. With much puzzlement, the electrician agrees to take the call.

The Taxman calls on his break from a payphone and explains how he hates to see the little guy get burned out of spite, when the big fish know how to play better in the game. The taxman says, make sure that you clearly write new installation on all your invoices and keep them. Evidently sales tax is charged on the labor for repairs not new installations.
 

·
Registered
Joined
·
1,460 Posts
Discussion Starter · #8 ·
Hack Work said:
You charge sales tax on repair work and only on labor. This is when doing your invoicing digitally really helps, you set it so that sales tax is only applied to the labor on items that are considered repair, then it will calculate it automatically for you. You have to file sales tax quarterly, by the 20th of the month after the quarter. Jan, Feb, Mar- File by Apr 20th Apr, May, Jun- File by Jul 20th Jul, Aug, Sep- File by Oct 20th Oct, Nov, Dec- File by Jan 20th You have to file even if A) You collected $0 sales tax or B) you can't afford to pay the state the money at the time. If you don't have the money you still file on time or else you will get hit with much worse penalties. You need to register to accept sales tax, did you do that yet? Once you register, you are now on the state's radar. You need to get a signed ST-8 form for every singe job you do that is exempt from sales tax (which is most of them). That's what sucks. I know a lot of different small contractors in the various trades who never signed up for collecting sales tax. They consider all of their work to be exempt capital improvement. And since they never singed up, they don't have to deal with the ST-8 forms. I'm talking about 30 year old companies that when I asked the owner about ST-8's they had no clue.
yes I am signed up...where do you get a st 8 form? So if I do a rough in and final, I charge sales tax only for labor and if I change out a panel I also have to charge sales tax since that is a repair?
 

·
Banned
Joined
·
1,246 Posts
I had a neighbor up the street who is in the trade with a license. He was signing permits for a local HVAC company (surprise, surprise) for the a/c hookup to the power. Well they jumped the gun and did the work by themselves. The local inspector calls up and says your job failed. What job? I didn't do that work, I was supposed to.

So the inspector runs rampant on the HVAC company. The HVAC company decides to stir some sh!t back and calls up Trenton and say he collects no sales tax. A NJ treasury guy basically says you were ratted out by x after looking everything over. The taxman asks to call him back collect in a few minutes. With much puzzlement, the electrician agrees to take the call.

The Taxman calls on his break from a payphone and explains how he hates to see the little guy get burned out of spite, when the big fish know how to play better in the game. The taxman says, make sure that you clearly write new installation on all your invoices and keep them. Evidently sales tax is charged on the labor for repairs not new installations.
Yes, this is exactly it.

When the state audits you, they only have your invoices to go by.

Let's say a customer wants you to fix their service because a tree pulled it down.

You can invoice it as "Repaired electrical service" in which you need to collect sales tax. Of you can invoice it as "Installed new service riser" which is a capital improvement and you don't need to collect tax.
 

·
Banned
Joined
·
1,246 Posts
yes I am signed up...where do you get a st 8 form?
http://www.state.nj.us/treasury/taxation/pdf/other_forms/sales/st8.pdf

If you have the right type of PDF viewer, you'll notice that you can fill in all those lines right on your computer. I enter in all my company info and then save it, then I pull it up later to enter the customer info. I do this on my iPad when I am at the customers house's, they sign it with their finger and I save the ST-8 in a folder.

So if I do a rough in and final, I charge sales tax only for labor and if I change out a panel I also have to charge sales tax since that is a repair?
No, nothing that you mentioned is a repair, it's all capital improvement.

Even changing a small light fixture out is considered a capital improvement.
 

·
Banned
Joined
·
1,246 Posts
Elephante,while we're on the subject, this is what you should be using for electrical permits:

http://www.state.nj.us/dca/divisions/codes/forms/pdf_ucc_stdforms/ucc_f120_elec.pdf

Fill out all your company info and license stuff and then save it to your computer. Then when you need to apply for a permit, fill the rest out and print 4 copies. But don't save it (at least not under the same name) cause then you will lose the blank permit with just your company info.
 

·
Banned
Joined
·
4,505 Posts
Hack Work said:
http://www.state.nj.us/treasury/taxation/pdf/other_forms/sales/st8.pdf If you have the right type of PDF viewer, you'll notice that you can fill in all those lines right on your computer. I enter in all my company info and then save it, then I pull it up later to enter the customer info. I do this on my iPad when I am at the customers house's, they sign it with their finger and I save the ST-8 in a folder. No, nothing that you mentioned is a repair, it's all capital improvement. Even changing a small light fixture out is considered a capital improvement.
That what I do I rarely collect sales tax.

Mostly everything can be considered a capital improvement

I even put on my invoices stuff like

Install/ repair duplex tamper proof receptacle.

That way it's an install not a repair
 

·
Banned
Joined
·
1,246 Posts
That what I do I rarely collect sales tax.

Mostly everything can be considered a capital improvement

I even put on my invoices stuff like

Install/ repair duplex tamper proof receptacle.

That way it's an install not a repair
Yup. If I go to fix a problem with a circuit not working, and I fix a bad splice, I write it up as "New wirenut installation" :laughing::thumbup:
 

·
Registered
Joined
·
1,460 Posts
Discussion Starter · #16 ·
Hack Work said:
http://www.state.nj.us/treasury/taxation/pdf/other_forms/sales/st8.pdf If you have the right type of PDF viewer, you'll notice that you can fill in all those lines right on your computer. I enter in all my company info and then save it, then I pull it up later to enter the customer info. I do this on my iPad when I am at the customers house's, they sign it with their finger and I save the ST-8 in a folder. No, nothing that you mentioned is a repair, it's all capital improvement. Even changing a small light fixture out is considered a capital improvement.
so pretty much I have to prove it was a capital improvement with st 8 form and omit repair on the invoice and put new installation.
 

·
Registered
Joined
·
1,460 Posts
Discussion Starter · #17 ·
Hack Work said:
Elephante,while we're on the subject, this is what you should be using for electrical permits: http://www.state.nj.us/dca/divisions/codes/forms/pdf_ucc_stdforms/ucc_f120_elec.pdf Fill out all your company info and license stuff and then save it to your computer. Then when you need to apply for a permit, fill the rest out and print 4 copies. But don't save it (at least not under the same name) cause then you will lose the blank permit with just your company info.
thanks your the best...
 

·
Senile Member
I make all the electrons line up for their Flu shots
Joined
·
35,311 Posts
You guys would love the excise system they have set up here. Tax everything , tax it multiple times - every time it changes hands, and add 5% more if it is Honolulu county instead of outer island.
 

·
Banned
Joined
·
1,246 Posts
so pretty much I have to prove it was a capital improvement with st 8 form and omit repair on the invoice and put new installation.
Yeah, if you don't collect sales tax, the state is going to want to see an ST-8 form in it's place. It's not the end of the world if you forget with a couple customers, you can always have them sign it later if you get audited.

If you are going to be doing a lot of repairs, such as service calls to fix things, then just collect the tax and pay it at the end of the quarter. It's pretty easy to do. Make an "item" in both your invoicing program and QuickBooks for repairwork and make that item taxable. The software will take care of the ret and tell you how much you owe at the end of the quarter.
 
1 - 20 of 64 Posts
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Top